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Ernst & Young Outlines Discussion Topics for Meeting

FEB. 11, 2000

Ernst & Young Outlines Discussion Topics for Meeting

DATED FEB. 11, 2000
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=============== SUMMARY ===============

 

Ellen McElroy of Ernst & Young LLP, Washington, has outlined the topics she would like to discuss with Treasury at an upcoming meeting on the proposed uniform capitalization rules for farmers. Those topics include (1) the development of simplified methods for allocating costs to livestock produced; (2) clarification of the availability of existing de minimis rules under section 263A; and (3) clarification of the depreciation allowance for livestock used in the trade or business.

 

=============== FULL TEXT ===============

 

February 11, 2000

 

 

Cristy Turgeon

 

Department of Treasury

 

1500 Pennsylvania Avenue, N.W.

 

Washington, D.C. 20220

 

 

Dear Cristy:

[1] I would like to thank you for agreeing to meet with us concerning the proposed, temporary regulations issued in 1997 regarding uniform capitalization rules for farmers. We would like to share with you concerns of livestock producers apropos of the impact of these regulations and recommendations to ameliorate these concerns. We hope that Treasury will work to provide additional guidance in this area.

[2] The topics we would like to discuss with you are as follows:

o Issuance of an automatic revenue procedure which would permit

 

taxpayers to discontinue use of the unit-livestock-price-

 

method and to adopt other proper methods under section 263A.

 

 

o Development of simplified methods for allocating costs to

 

livestock produced and clarification of availability of

 

existing de minimis rules under section 263A.

 

 

o Clarification of allowance of depreciation for livestock used

 

in the trade or business.

 

 

o Effectuation of a conforming change to the regulations under

 

section 471 to make methodology more accurate.

 

 

[3] We look forward to meeting with you tomorrow. Thank you once again for your assistance in this matter.

Very truly yours,

 

 

Ellen McElroy

 

Ernst & Young LLP

 

Washington, DC
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